Posted
by
Soulskill
on Saturday September 18, 2010 @12:01PM
from the stories-that-don't-involve-deer-and-the-king's-land dept.

lightbox32 writes "According to the Wall Street Journal, several of the US's largest technology companies, which include Google, Apple, Intel, Adobe, Intuit and Pixar Animation, are in the final stages of negotiations with the Justice Department to avoid a court battle over whether they colluded to hold down wages by agreeing not to poach each other's employees. 'The Justice Department would have to convince a court not just that such accords existed, but that workers had suffered significant harm as a result. The companies may not want to take a chance in court. If the government wins, it could open the floodgates for private claimants, even a class action by employees. A settlement would allow the Justice Department to halt the practice, without the companies having to admit to any legal violations.'"

The following companies confirmed they were questioned but have been relieved of the Justice Department investigation:

IBM
Microsoft
Yahoo
Genentech

The agency has decided not to pursue charges against companies that had what it believes were legitimate reasons for agreeing not to poach each other's employees, said people familiar with the matter. Instead, it's focusing on cases in which it believes the non-solicit agreement extended well beyond the scope of any collaboration.

Collusion of any kind should never be allowed, as it distorts freedom and hurts consumers (and workers).

One of the reasons I quit IEEE is because I got tired of reading articles from them about how the government needs to allow more H1B1 visas to hire foreign engineers/programmers. Clearly IEEE was colluding with corporations and representing their interests. Why would I want to face competition from Temp Engineers willing to work at $15/hour? If companies face a shortage, let them hire some unemployed or fresh-out-of-college Americans rather than import workers. So I stepped sending money to IEEE.

If companies face a shortage, hire some unemployed or fresh-out-of-college Americans rather than import workers

You make it sound like software engineering is utility. Importing workers has a cost too and salaries of HIB1 are public and they are not lower than others. Basically companies get more talents to choose from and of course some local people would hate that. These Temp Labors you are talking about work in the field under the sun and you are not competing with them unless you want to work there.

the IEEE is supposed to be an institute that furthers the needs and status of institute members, that is the chartered engineers themselves NOT the employers. It should be working to uphold the status of the chartered engineer in society and ensuring the experience and qualifications required to gain chartered status are respected and valued appropriately.

IEEE may or may not involve itself in a political issue that is globalization, but I was just pointing out the usual cheap labor argument does not apply in software engineering. Companies want more candidates while locals don't. It's a political fight.

Right. I guess Apple and Microsoft and IBM are moving their software development over to cheaper countries because..... what.... for fun? C'mon. I know you're not that dumb as to believe that "cheap labor don't apply to software" statement. They do it because the programmers are one-half to 2/3rd cheaper.

>>>These Temp Labors you are talking about work in the field under the sun

Someone doesn't know how to read. I was discussing IEEE articles, which were specifically about importing more TECH workers for Microsoft, GM, and so forth, not potato farmers. And yes if you double the supply (via imported workers), than that means the price goes down for the hiring companies. ECON101. That's what they - to drive down wages.

>>>Wait - so the companies are bad for not being competitive enough but it is okay when you don't want competition?

No.

Strawman argument. Don't put words in my mouth I did not say.

I said IEEE was bad because they are supposed to represent the engineers, and instead are representing the companies (pushing to import cheap labor) which eventually hurts Americans who are unemployed and can't find work. So I stopped sending IEEE money. As is my right. Maybe more people should do that, rather

Well if you WANT to see American engineers and factory workers' wages drop to $5/hour and $1/hour respectively (in order to compete with cheap Indian and Asian labor), that's cool. You're free to hold any viewpoint you want.

I just don't happen to agree with that position. We should be forcing these other countries to have basic workers' rights, rather than smashing them underfoot like cattle in a slaughterhouse. (See the 100+ suicides/murders at Foxconn.)

This is the best argument against any of these types of labor practices. It's not about wage or commodore64 there not being able to find a job - it's that his kids will certainly not want to pursue his career and eventually schools will start dropping the programs from their options. It is like a reverse brain-drain. We may get the good Indian workers, for a while, but then we will be stuck when they are bigger than us (and we've fed them info and life experience) and we have nothing to come back with.

I happened to work in a place where both HP and Microsoft employees in close proximity, and I was informed by many employees that there were agreements that the other would not hire the workers of one, until they had been away from their respective company for at least 6 months...

I knew guys on the HP side that wanted to work for Microsoft, but they couldn't afford a 6 month vacation in order to get a job elsewhere...

Of course IBM was - for the exception of some token R&D projects in Austin, they sent all of their R&D and IT jobs overseas. The only things left here in the States are salesmen and management and other assorted business support services.

... unless it gets in the way of making a huge profit on the backs of your underpaid employees, assisting with censorship, handing over political dissidents to tyrannical regimes, or releasing a mobile operating system that is open only to the carriers & manufacturers but not the users (who can't install binary apps outside of a java sandbox)!

Seriously, that's the least of it. Eric Schmidt is now regularly making grand, dystopian predictions as if his vision of the future is all we deserve. Add a big, swivel chair and a Persian cat and he'd come off like a Bond villain. Because remember, the little people don't deserve the privacy that HE deserves. After all, our privacy gets in the way of his profits. As do some laws. So we'd better change those to his liking in a hurry!

IBM, Apple, Google, Microsoft, HP....not one of these companies has ever approached me for employment. Coincidence? It's obvious a back-room deal was struck to not put all the others at such a disadvantage if one ever decided to hire me.

"OK, we agreed that I do no further murders. But what about rapes?""Rapes? Did you ever rape someone?""No, because I murdered them. Since I cannot murder them in the future, I want to rape them instead.""Well, what do you have to offer?""Well, I offer to never rob a bank.""You haven't yet robbed a bank, have you?""But I could start to, and then it would cost you money to catch me.""OK, makes sense. So, you never rob a bank, and we allow for one rape per year. You have to register each rape with us, though,

How is this legally different from a typical teaming agreement? The purpose of a teaming agreement is, in part, to keep wages reasonable by discouraging poaching. This is very common and legally enforceable in Virginia. If one our partners offers an employee a sweeter job, their ass is grass once Legal catches wind of it. If another large consulting company comes us to us and offers a large-scale agreement, I don't see a fundamental difference.

I work at one of the companies in the investigation and I was recruited by another.

On top of that I've hired many people into the company I work for (which again is one of these) and my recruiter told me exactly what's allowed and what's not.

What isn't allowed:Actively recruiting people from the other companies. That means no cold-calling, no standing outside their parking lot, no poaching at tech conferences.

What is allowed:Hiring their people. If they submit their resume, it's fair game. If someone else submits their resume, it's fair game.

And on top of that, as I mentioned above, one of the companies even broke the rules to try to recruit me, so I'm sure the company I'm at does it too to the others.

Anyway, none of this really hurts the employees, if you want to find a new job, no doors are closed to you just put your resume out there.

On another note, not mentioned in this investigation (that I know of), the company I work at has a "freeze-out" on another company. Anyone who left this company to go there is blackballed and is not to be hired back. How long that will last I dunno, but for now they're very serious about it. This actually might hurt employees' career prospects and probably is illegal.

Oh, another another note, it's common in the industry to do salary surveys. Each year, the companies actually collude to share information about how much they are paying their employees in different positions and then they do equivalent rankings. They then report these figures as part of their annual compensation reviews/reports. I have to imagine sharing this information makes it a lot easier to put in place these "no cold calling" agreements.

You want competitive labor markets, you got competitive labor markets. These workers can try competing against workers in China, India, and other nations with a rapidly improving skill base in information technology and a lot of mouths to feed.

These employees should have got while the getting was good, and kept their mouths shut, because these companies had actually decided to keep them employed rather than shipping their jobs outside US borders. With this "gentleman's agreement" out of the way, what else

I've been trying to think of ways to describe how capitalism in the United States has degraded to Corporate Fascism. This is a fantastic example of corporate fascism -- something citizens can relate to; and these are just the corporations which got caught....

Rather than down mod this rather silly comment, I'll take it seriously. Fascism is a political system in which corporations collude with an autocratic government in exchange for special treatment. (Some people would say that Berlusconi's Italy is not that far off it.) Here, the Government is refusing to let corporations behave in an anti-competitive manner, whether they waste money on lawyers doing it, or agree to be good and keep the lawyers out. That looks to me like democracy. As for companies behaving l

Am I the only person that sees the Apple board connection? Eric Schmidt(Google), Paul Otellini(Intel), Steve Jobs (Pixar/Disney), and Scott Cook(Intuit) all sat on Apple's board. I believe they even all server simultaneously. That's everyone but Adobe, who definitely has their ties with Apple too, even if those ties are strained right now.

What I love are the contortions employers go through to complain that they can't find talented people while doing everything they can to make sure they don't accidentally hire talent. Ranges from interpreting experiences and education as not applicable or relevant to flat out just not believing the resume, though they don't put it that way of course. Things like declaring that Windows Server 2003 experience doesn't count for Windows Server 2008. We've all heard the stories about the requirements for more years of experience than is possible. And who knows, maybe they've made a subjective evaluation that they just don't like this dorky geek they're interviewing and are trying to push his buttons, trying to create the excuse they need to show him the door. The way things should work is that a CS degree ought to be enough for a development position, period. And that no one earns such a degree if they can't develop. Post a "help wanted" ad, and take the next appropriately degreed person who walks in the door. I think it nearly was that easy to get professional work in the 1950's. But now?

And then they poach each other? These employers are like the sort of women who think all single men are single because there's something wrong with them, and spend all their time trying to steal married men away from their wives. It's an understandable kind of mental laziness. Why go to all the trouble of thoroughly checking someone out when it's easier to let others do that and then lure away their picks? However, they have to balance that with several worries. Not all picks are good ones. If he could be lured away once, he could be lured away again. Or that a prospect might be a waste of time because he's faithful and satisfied and can't be lured away.

Non-poaching agreements definitely damage the unemployed. It might seem the other way. If an employer can't poach, the only place to look is the market. But in balance, I think that benefit is outweighed by the lower compensation they can pay, and the effects that has on everyone. Without such anti-competitive measures, some of these employers would more often take a chance on someone who is less likely to be tempted away and who can be hired for less.

This is probably just an agreement not to pinch staff in order to stymie a competitor. Sure you can recruit staff because you want to do something better, and in general this is good for the public, but you can also do it just to stop the competitor doing something better than you. Like grab key staff in a key department, not because you have any particular use to them but because frankly it's worth you paying them just to not go and work at the other guy. This is a tactic that involves everybody losing, bu

As always, it looks like the actually affected employees who had their job mobility significantly reduced, and hence their bargaining power, GET NOTHING out of this. How is this a victory, except on some government lawyer's resume?

I appreciate in these divisive times rhetoric is at an all-time high, but let's look at some facts, shall we?

First, these practices took place with government regulation in place. Two: the current actions of the government coddling... errr, negotiating with the companies may adversely affect the ideal libertarian solution: workers suing the companies directly. Three: if the end result is companies not admitting wrongdoing and a government who failed to stop the practice in the first place now promi

Yep. I'm a pretty hard core capitalist, in that I believe it is the only fundamental system that works. However that doesn't mean it doesn't need some regulation. Reason is that capitalism only works when there is competition. When companies fight people win. This applies not only in terms of product competition, but competition for employees as well. The incentive to keep working conditions good, pay high, and so on is that if you don't, you'll lose good people to other companies.

Well, just like this any other kind of collusion, if they collude to keep pay down, that is anti-competitive and hurts things in the long run.

For that matter, that sort of thing leads back to what originally started unions. Something mining companies were particularly good at was removing any mobility you had. You'd find a mining town and the only stores in town were owned by the mining company. As a miner, you had no choice but to shop there. They charged outrageous prices, which in tandem with low wages meant you had to run credit. You got indebted to the company and couldn't leave.

Now obviously this is far less odious, but it is the same kind of thing just a much lesser degree. They want to artificially depress prices and work to remove mobility from the employees. You get a job at one company, and the others just won't hire you. That then lets them pay less, and care less about quality of work environment.

Remember that the reason to like capitalism isn't for its own sake, but because it gives us a society that is over all the best for people, one where people are better off over all than any other. What that also means is we shouldn't just take a hands off "Anything goes," idea. When something runs counter to that, we need to step in and regulate it. That really is the function of government after all.

It is rarely the case that extremes work well, and capitalism is no exception. It works extremely well, but that doesn't mean you let it run rampant and have an "anything goes" kind of attitude. You regulate and balance it to try and create a system that has the greatest overall benefit.

Remember that the reason to like capitalism isn't for its own sake, but because it gives us a society that is over all the best for people, one where people are better off over all than any other.

No, "we" like capitalism because it glorifies being a greedy pig who can afford to overindulge while making fun of all the have-nots created by "our" hoarding. "We" just love it that those anti-materialist, unambitious scumbags have to either get with the program and sell out or become disenfranchised and do with

What I really don't understand is why people are in such support of capitalism run-wild, that a mining town that buys and sells everything from coal to soap to workers themselves is such a good thing. If corporations are people, by law, why do we want to give them more rights.

When it gets to the point that a company is taking advantage of the workforce - the the point that Microsoft won't pay you double your salary, though you are qualified and they have it, because your actual employer made a deal with the

Aside from all those companies who have been bailed out and keep asking for more money and all the telecom companies who were given huge tax breaks in the 90's for fiber-to-the-curb that never happened and don't want to repay the government, yes, you usually don't see capitalists whining about people not giving them free shit.

"It's the same false definition people use when claiming the GPL is the most "free" license. It's obviously less free than many other OS licenses, because it puts more restraints on what can be done with it."

Why'd you have to bring up that old troll?BSD grants most freedom to the recipient of the code, GPL grants more freedom to people further down the line, freedoms not given under the other licenses that folks like to argue about.

It's not like they control the market on developers. Unlike the price collusion on LCD panels where there were literally only a handful of manufacturers, this is simply a list of high-profile, high-paying employers. They don't corner the market on jobs.

By that standard, Google would have to be attempting to make these people unemployable, or severely restricting their ability to find a new job. I'd argue that they're doing neither. Nor is that the result.

"The companies have argued to the government that there's nothing anticompetitive about the no-poaching agreements. They say they must be able to offer each other assurances that they won't lure away each others' star employees if they are to collaborate on key innovations that ultimately benefit the consumer."

They have a point. You could spin it as beneficial to employees because it protects the employer from being hurt by competitors hi

It's highly disruptive to be laid off the day after you close on a house -- happened to a friend of mine. It's highly disruptive to be laid off with a baby on the way -- happened to me. Workers get no protection from "highly disruptive" -- it's on our heads to have savings and backup plans, just in case. If a project is that valuable to a company, then they will find a way to compensate their employees (e.g., completion bonuses, and yes, I have even been paid

You could spin it as beneficial to employees because [...] it keeps the salaries of "superstars" from inflating to artificial highs

Hurrah! Thank you, noble executives, for colluding to make sure that the people who work their pants off to make you rich will never themselves receive anything like as much compensation as you do! We are truly, truly grateful that our salaries are not inflated like yours are.

In my experience the (often self-annointed) "superstars" are seldom the people working their pants off, YMMV. Big differences in pay are also bad for moral as evidenced by your post. The solution is bringing executive pay down not raising the salaries of another chosen few to ridiculous levels.

Keeping wages artificially low is hardly "just some companies making a deal". It's anti-competitive and disrupts the marketplace. It's also illegal.

Yeah, but not the "true" marketplace. This is just some lowlife "individuals" wanting to make more than they deserve (anything that doesn't involve an MBA should be capped at $100k). It shouldn't be too hard for these god-like beings (corporations) to get this to silently go away.

I was trying to point out how we have elevated corporations over individuals to the point of absurdity. It was also commentary on how fucked up what we value sometimes is. It's ridiculous that a CEO can make over 1000 times that of his lowest paid worker. PHds in Computational Linguistics are in general more valuable to society than MBAs, and should be remunerated thusly.

Really? Illegal? How do the various salary caps for teams get by in sports leagues?

Or are you trying to say that you had to work at one of those companies because they are the only places that you can work and you are incapable of doing something else? For it to be illegal they'd have to control the market. Those companies do not control the IT job market, they don't even control a tiny percentage of it. So it doesn't really matter what deals they make, there are plenty of other companies not making an

Those salary caps you cited are completely out in the open and agreed upon by the owners and the players' associations. Without those players' unions, the players would be making far, far less money than they do under the current salary caps (and they did make far less, in the old days). If these current allegations are true, it's a completely different set of circumstances - companies secretly agreeing not to poach in order to hold down salaries is what we don't like. If there were unions for these empl

well its struck me as odd that US sports are run on such socialist lines - imagine Ronaldo (a Soccer superstar).

"soory lad I know you wanted to play for Manchester united, but the draft pick says your going to have to play for cowdenbeath fc and dont worry we've arranged to change your name to Billy as there a bit funny about Fenian bastards like you in that part of Scotland.

However, any USA or EU investigation will uncover only the tip of the iceberg. Most of the high tech wage bill has long gone to a place with a warmer and wetter climate. There nearly all companies have strict (and fairly open) non-poaching agreements including non-hiring of employees who want to leave a "competitor" and reporting such employees back to their employer.

I am not joking here by the way, just search linked in for Nokia, Ericsson, etc job ads in India and read the attached discussion.

Well, there are antitrust laws that preclude them from collusion, both in the customer marketplace and in the labor market. I don't necessarily agree with such manipulation of markets, but such collusion is as anti-competitive as was Microsoft's attempted collusion with Netscape (divide the browser between Windows and everything else) and Apple ("knife the baby").

So if you were calling for blood when Microsoft was doing it, you should be calling for blood when Google or Apple does it, at least if you're try

Well, there are antitrust laws that preclude them from collusion, both in the customer marketplace and in the labor market. I don't necessarily agree with such manipulation of markets, but such collusion is as anti-competitive as was Microsoft's attempted collusion with Netscape (divide the browser between Windows and everything else) and Apple ("knife the baby").

Most anti-trust laws like the Sherman Anti-trust act apply to trusts like monopolies and cartels. And they apply to products and services to consumers, not labor unless the product or service was labor (i.e. a temp agency). Before any anti-trust laws can apply, there must be a trust established. I don't think that anyone can argue Apple nor Google has any control of labor. The situation might be different if it was two temp agencies that controlled the temp supply in a region. It may be illegal for othe

You know what? You're absolutely right. Industry should have the absolute word on what they do for their hiring practices.

They are private companies. If they want to do these things, they should be able.

If they want to not hire old people... Tough, it's private industry, man!

Or black people. Now, I'm not a racist. Many of my friends are black. But if a private company wants to refuse employment to black people, who am I to tell them "no, you can't make private business decisions about your private business"! God, we live in such a nanny-state these days.

And those disableds, you know, the funny-looking, wheelchair ones. If the boss doesn't want those guys cramping their style, I say, give them the boot.

And if people want to unionize? Tough shit! The boss owns the company, not the unions, not the gub'ment, so they should keep their gritty hands off.

I am really afraid that the openness of private industry is inhibited by preventing hiring decisions. Think of the economic damage caused by letting all these undesirables get hired! Can you imagine? Some of them might actually make a living!

</hyperbole> Damn, the Reagan era and all of the bullshit that followed has really contaminated people. Employees being able to "play the field" and better negotiate their salary is a good thing. For crying out loud, even you free market idiots in the audience should like it, because it allows employee wages to be set by the free market. But some people will go so far to defend the actions of corporate oligarchs that they are willingly blind to such realities...

These agreements are standard fair when companies sign contracts to do business. Intel has a contract to design parts for Apple, Apple had a contract to share services with Google, Apple would have a contract with Adobe to share things like PDF support and such, etc. Not poaching employees from another company under contract is a standard business contract. Pretty much any company that hires a "consultant" from another company has such agreements in place because close business relationships often mean the

These agreements are standard fair when companies sign contracts to do business. Intel has a contract to design parts for Apple, Apple had a contract to share services with Google, Apple would have a contract with Adobe to share things like PDF support and such, etc. Not poaching employees from another company under contract is a standard business contract.

And perhaps it is reasonable if it is limited to only those employees working on the joint projects where contact is established through the contract.

I think this top post should NOT be marked flamebait (so that it drops below the thresholds many of us set to ignore). While I don't agree with it at all, it is a point that many people believe and should be debated, not shouted down just because you don't like it. How about keeping it up and showing why it is bullshit by making valid points for a change?

This has nothing to do to NDAs. If you read the articles and previous posts, you will see a list of bussiness who where relieved of the investigation because there were "legitimate reasons".

In short, if you own a car factory, you can agree with other car factories not to poach to avoid claims of NDA/IP breaches. You cannot agree to that with airplane factories because the only reason is not to pay the employees what they are worth.

It is curious that so many "free market" advocates forget about it when it do

BS, some states have made near impossible for unions to exist, and that is exactly what the corporations are doing here, unions do the same thing, they find what is the average or best pay a worker can get for a certain job and make sure all people that do that job get the same pay, this is no different, except when the corporation's do it, it's ok, and when people try to do it for themselves its somehow not ok.Call me a socialist all you want, seems to be very popular right now to call people that, but if

Ahhh the Apple Fanbots strike again, trying to censor posts via moderation. I don't agree with you (Jobs isn't the only cheap CEO), but neither do I think you should have your Karma damaged or post made invisible. All ideas should be welcome
.